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  1. #1
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    Post ETF's NZX or ASX?

    Hi there,
    this is my 1st post, "hello" to all.. I'm hoping to get a bit of advice or at least info in terms of general direction. I have opened an A/C with ANZ securities (now Direct Broking - FNZC) - I am interested in ETF's and putting some savings into some funds etc. I have looked at BETA ETF's on the ASX which I found quite helpful - can anyone tell me if I invest in any of these ETF's on the ASX will I be disadvantaged tax wise or is this minimal to the point that no need to worry? Or do I just go for the NZX listed types. Be glad to hear comments - or any thoughts yea, nay or otherwise! Thanks heaps!!

  2. #2
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    Quote Originally Posted by MuffinPop View Post
    Hi there,
    this is my 1st post, "hello" to all.. I'm hoping to get a bit of advice or at least info in terms of general direction. I have opened an A/C with ANZ securities (now Direct Broking - FNZC) - I am interested in ETF's and putting some savings into some funds etc. I have looked at BETA ETF's on the ASX which I found quite helpful - can anyone tell me if I invest in any of these ETF's on the ASX will I be disadvantaged tax wise or is this minimal to the point that no need to worry? Or do I just go for the NZX listed types. Be glad to hear comments - or any thoughts yea, nay or otherwise! Thanks heaps!!
    Look up FIF rules for investing into ASX listed index funds. If you own over $50k, tax can get complicated.

    I've found it best to just stick to index funds through NZ companies, Superlife, Smartshares, Investnow, Sharsies & Simplicity are all good options. Plus no brokerage if you go through this route.

  3. #3
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    Muffin; im curious about your timing here, are you really feeling bullish about global markets?

  4. #4
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    Quote Originally Posted by Joshuatree View Post
    Muffin; im curious about your timing here, are you really feeling bullish about global markets?
    If you're investing for the long term - ie 10 years +, then timing isn't so much of an issue. In fact before Trump was voted in, countless of so called experts claimed there will be a stock market crash. At that time the DOW was around 17K. Now we're at 25K. How do you explain this gain in the past 2+ years if you listened to the bears and sat on the side lines?

    If I was Muffin and was playing with small $ (well under the $50K threshold of FIF), I would look none other than US equities. There's a lot at stake with the upcoming capital gains tax in NZ which could trigger capital outflows and a weaker NZD to the USD exchange rate. The NZ equity market (in ETF form or not) are not mutually exclusive to the global investing market.

  5. #5
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    Im looking to more cash when i get the opportunities, i dont attempt to time bottoms thats a fools game imo but i dont like entering the markets at what i think is a dodgy, high risk time. Time in the mkt is one good thing, the timing of entry and the price(off a bottom not teetering at a top) is another. Just my opinion. Capital Gains tax, i will wait before jumping to conclusions.

  6. #6
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    I think you've missed my point. I'll be more specific. How do you know we are in dodgy "high risk" times? Over 2 years ago there was plenty saying the market was over valued when the DOW was at 17K and their main motivation was how far the DOW has risen since the GFC of 2008. I know people that for the past 10 years of that major event had chosen to sit on the side hoping the market would re-correct. DOW at 10K, "Nah it's gonna go down", DOW at 13K, "Nope.." DOW at 17K "It's WAY flying high", DOW at 25K "????". My point is who is so sure? Because when you sit on the side lines, eventually you'll miss gains that you'll never recoup.

    I have little or no experience owning NZ equities (as you can tell i'm biased towards US markets). The reason is the basic principal owning NZ shares (or NZ share investing in general) is the over emphasis of dividend payment. It's a logic I could never understand from a tax efficiency perspective. Why do NZ share investors focus on dividends when they are taxed? vs if the corporation would hold the after tax income on the balance sheet, which increases it's book value, and thus increases the share price which = a tax free capital gain to the shareholder. It's a basic fundamental question I ask with The Warehouse Group shares having a dividend paying policy. I mean for decades, i've seen their shares stay basically at the same price as when they went public. Because they pay out their cash flows in dividends, then go to borrow more $ for capital expansion ; or even worse, issue more shares (causing share dilution). Anyways, will be interesting to see what CGT would do to the NZ investing environment.

  7. #7
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    Thats fine you stay in im pulling money out for myself and our more conservative estate portfolio and moving to more cash/bonds etc.

    I believe that things are tipping over globally. I may be wrong but it fits my situ ATPIT to reduce holding equities after the longest bull run in history. Im so thankful ive got a 2nd chance as i dithered a few months back.

    Everyone has their own criteria and risk/reward situ, and importantly timeframes, its finding what works best for oneself and not following a herd. I personally think now is not a good time to be entering , but to each their own.

    Most kiwis i know when i mention shares their eyeballs glaze over and then mention of the 87 crash comes up, sadly.

    if one is TRULY investing for a longterm 10 years plus and they wait out a possible correction first their gains are truly magnified. Also something that drops say 30% has t go up 40% plus just to get back to evens. If i was entering now id at least average my entry out over time and not lump it.
    Last edited by Joshuatree; 11-02-2019 at 12:00 PM.

  8. #8
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    Timing in and out of the market is a fools game. You don't have to take my work for it:

    https://www.marketwatch.com/story/th...ims-2019-02-06

    "Investing legend Peter Lynch once said, “Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.”

    Agree the subject of stocks (or shares) in NZ is negative. I just hope that the introduction of CGT would make Kiwis understand more about investing and discourage them away from profiteering off real estate investments (which can deprive those that need to buy their 1st home etc.). I get that NZ real estate investing has a clear tax advantage over any other investment in NZ (but I think that door will quickly close this year). The real issue is will NZ equities perform as well as overseas equities once NZ's introduces CGT on them? Because at the end of the day, the fund manager has to choose which company (or shares) will profit more. EBITA only tells half of the story (hope these Kiwi Saver fund managers realise that because EBITA is a poor way of measuring the company's performance).

  9. #9
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    Name calling ehh, tells me alot. You stick with your legends SBQ. One thing ive learnt is that all these talking heads near and far dont give an atom of care about you losing or making your money.
    Good to see Pie funds ( i hold) have alot in cash atm btw, prudent.

    Good luck Muffinpop whatever you do do it right for your own unique situ.

  10. #10
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    [QUOTE=SBQ;746683]....countless of so called experts claimed there will be a stock market crash. At that time the DOW was around 17K. Now we're at 25K. How do you explain this gain in the past 2+ years if you listened to the bears and sat on the side lines?

    ...There's a lot at stake with the upcoming capital gains tax in NZ which could trigger capital outflows and a weaker NZD to the USD exchange rate.../QUOTE]

    Seems to be a bit of a contradiction between those two paragraphs!
    om mani peme hum

  11. #11
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    Seems to be a bit of a contradiction between those two paragraphs!
    Clarify from what angle? Both cases are mutually exclusive as they're different markets. An example, the 2008 GFC had a major impact on the US market while having minimal effect on the NZ's real estate market.

    Investment in NZ is concentrated in real estate (because of the lack of capital gain tax or simply, those that hold long enough can sell without paying any tax on the gain). You simply can't do that in the US as everything has capital gains tax regardless how long you hold it.

    If you read carefully, i'm not making any predictions. When the NZD went weak this past year, who questioned it? No one mentioned the billions of $ that left NZ over the foreign trust crack down by IRD (perhaps it wasn't newsworthy or news-friendly).

  12. #12
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    Quote Originally Posted by epower View Post
    Look up FIF rules for investing into ASX listed index funds. If you own over $50k, tax can get complicated.

    I've found it best to just stick to index funds through NZ companies, Superlife, Smartshares, Investnow, Sharsies & Simplicity are all good options. Plus no brokerage if you go through this route.
    Welcome to the forum MuffinPop. I would agree with epower if you want to invest fairly small and regular amounts for the long term. I'd simply be putting it into Smartshares USF (US 500 fund) or something similar. Cheap and worry free. We are in strange times right now so I have myself started putting a small amount every month into the USF with a long term horizon in mind. DYOR.
    Last edited by iceman; 27-02-2019 at 06:59 PM. Reason: Addition

  13. #13
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    Quote Originally Posted by iceman View Post
    Welcome to the forum MuffinPop. I would agree with epower if you want to invest fairly small and regular amounts for the long term. I'd simply be putting it into Smartshares USF (US 500 fund) or something similar. Cheap and worry free. We are in strange times right now so I have myself started putting a small amount every month into the USF with a long term horizon in mind. DYOR.
    With the news of CGT looming about, it wouldn't matter where you put your $ in NZX or ASX, they're all going to be subjected to CGT. The days that certain 'potentially tax free' asset groups like real estate are numbered.

  14. #14
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    Sign up to Superlife and invest directly. Low fees and you can withdraw/change ETF's in 2 days or less with no fees. I suggest avoiding the NZX/ASX.

    https://thesmartandlazy.com/2017/05/...n-new-zealand/

    https://www.superlife.co.nz/investme...funds-and-fees

    Smartshares is also an option.. and has a different fee structure.

    1. If you intend to withdraw/change your mind often = Superlife (virtually zero fees apart from slightly higher fund fee)
    2. No changes to investment = Smartshares (slightly lower fund fees and high switching costs)

    https://investnow.co.nz/thesmartandl...g-new-zealand/

    The following fees also apply:
    SuperLife Invest

    • Administration fee - $12 a year (regardless of the number of investment options you invest in, or the number of times you change investment options).
    • Paper statements fee - $18 a year (you will only be charged this fee if you choose to receive statements and other SuperLife communications in paper form).
    Last edited by Schrodinger; 06-03-2019 at 11:02 AM.

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